The Latin American international investment and insurance marketplace is one of the fastest-growing in the world, with the demand for protection of assets amid volatile political and economic backdrops as necessary in 2020 as it ever was.
Across the Latin American region, the need for both products and advice is on the rise.
The inaugural International Investment Latin America Forum will look at where the industry is heading, the challenges and opportunities for the industry in the region, and how advisers, brokers and product providers are adapting to political and regulatory changes.The event will take place on Tuesday, 6th June , Miami.

The inaugural International Investment London Forum will look at where the industry is heading, the challenges and opportunities for the industry in the region, and how advisers, brokers and product providers are adapting to political and regulatory changes.The event will take place on Thursday, 30th April at the South Place Hotel, London.

The 21st International Investment Awards will take place on 8th October 2020, at One Whitehall Place, London. The II Awards are the longest-running event of their kind and last year saw a record number of categories and entries.

Three sources of alternative alpha for 2020

Cédric Vuignier

24 January 2020

Tweet

Facebook

LinkedIn

Send to

In the search for a balance of risk and reward in a portfolio, liquid alternatives can play an important role in identifying alpha (the excess return compared with a benchmark). The challenge is that true alpha only exists where there are market inefficiencies. Once too many investors are attracted to a strategy, those inefficiencies are simply eroded back into beta.

In this constant search for alpha, we believe three themes will stand out over the 12 months ahead.

The first is convertible bond arbitrage, which involves capturing value in the difference between a convertible bond and its underlying stock. The outlook for this strategy has not changed significantly over the last year. It can take advantage of a more volatile environment and at the same time maintains a position in the equity market. This strategy is also backed by a favourable corporate action pipeline and improved US new issuances, thanks to a new tax law.

Go big in Japan

Secondly, we think there is value to be found in Japan, perhaps ironically given our conviction the world's developed economies are threatened with ‘Japanification'. Yet, thanks to recent reforms under Prime Minister Shinzo Abe, Japan's corporate sector is undergoing profound changes.

By making cash more expensive for businesses to hold, Japanese companies are being encouraged to engage in more corporate activities such as merger and share buybacks. This is working. Activity is picking up, creating opportunities with more value for shareholders.

Disruptive technology

Finally, our third investment theme for the year ahead is ‘Machine Learning.' This is a revolutionary technology that is profoundly altering our experience of the world as computers develop their own algorithms, creating new applications to address new and existing problems.

We are at a stage where machines are data mining to build models and make discoveries in a range of fields that are independent of human hypotheses. This has created a race for data, and among investors, a search for alpha in the market. These are investable technologies, through highly specialized managers, working to optimise portfolios and create investment and forecasting models.

Each of these themes, we believe, will play out over 2020 and each has the potential to add usefully diverse sources of return to investors' portfolios.